This proposal requests five years of support to launch a study of 600 families and children of Mexican origin living in Sacramento, California. The research will address four important issues related to the early initiation of substance use. First the investigation will examine risk for and resilience to alcohol, tobacco, and other drug (ATOD) use in a critically important ethnic group in the U.S., children of Mexican origin. Mexican Americans living in California will become the most populous ethnic group in the state within the next several years, consistent with national trends for Latinos. Second, the proposed study will examine developmental processes leading to the initiation of substance use beginning in late childhood. A developmental approach is widely considered to be the best strategy for informing the creation of effective intervention programs that can prevent the initiation of ATOD use at an early age, when it is most likely to have severe long-term consequences. However, there are almost no developmental studies of ATOD use for children of Mexican origin. Third, the proposed research addresses the issue of family influences on the initiation of ATOD use, also considered crucial for early prevention. Finally, the investigation will employ state-of-the-art research methodologies for studying family influences on the development of ATOD use, an approach not previously used with children of Mexican origin. The study is framed within the context of a family stress model, which proposes that processes of acculturation, minority status, socioeconomic disadvantage, and neighborhood and school risks will affect parent-parent, parent-child, and sibling and peer relationships. These relationships, in turn, are expected to influence the initiation of substance use and related dimensions of child maladjustment. Also important, the model predicts that part of this syndrome of child maladjustment will include risky sexual behaviors, which are expected to combine with ATOD use to affect long-term risk for HIV/AIDs and other STDs. The model also proposes that cultural (respect, familism), personal (e.g., ethnic identity) and social (e.g., effective family problem solving) resources will diminish risk and generate resilience for children and families. Results of the study are expected to inform the development of more effective and culturally sensitive early prevention programs.